The myths of the South Sea Bubble - UCL Discoverydiscovery.ucl.ac.uk/12397/1/12397.pdf · THE MYTHS OF THE SOUTH SEA BUBBLE ... joint-stock South Sea Company which had been founded

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THE MYTHS OF THE SOUTH SEA BUBBLEBy Julian Hoppit

. The South Sea Bubble of looms large in popular depictions ofeighteenth-century Britain. But in many respects it is seriously misunderstood.This article begins by exploring mythic ‘facts’ about the events of , but isalso concerned to explore why the Bubble was mythologised long after the event.On several levels, therefore, the Bubble has itself been bubbled.

THERE is something very familiar about the South Sea Bubble of. It is that rare thing, a label given to an eighteenth-centuryoccurrence that has entered reasonably common usage. The Times, forexample, referred to it twelve times in , the Guardian seventeentimes and the Independent thirteen times. In recent years a facsimileedition of Bubble playing cards from has been sold on the highstreet, and the Bubble is on the BBC’s web site timeline for Britishhistory. In such places the Bubble is obviously employed with referenceto the financial crisis of , so brilliantly evoked in Hogarth’s famousdepiction of frenzied irrationality, economic chaos, religious corruptionand sexual dissipation, all in pursuit of lucre and luxury. But so familiaris the Bubble that it is also used as a fanciful allusion or metaphor, asin Noel Coward’s South Sea Bubble: A Comedy in Three Acts () whichis actually about the twilight of the British empire in the Pacific. Inshort, the Bubble has attained legendary status, at once familiar ifdistant, to be used confidently and freely. Yet this familiarity has twomythical aspects: the Bubble has suffered from considerable myopiaand misunderstanding, such that some of its long-lived evocations oftenneed to be considered mythologically, with their own origins anddynamics.

The Bubble, which was blown and burst in , centred upon thejoint-stock South Sea Company which had been founded in withmonopoly trading rights to much of South America, even though thewell-established Spanish and Portuguese empires there made the region

Figures produced by searching for ‘South Sea Bubble’ on the CD editions of thesenewspapers. The respective figures for were thirteen, fifteen and sixteen.

www.bbc.co.uk/history.

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Plate W. Hogarth, untitled allegory on the South Sea Bubble, . Copyright GuildhallLibrary, Corporation of London.

largely out-of-bounds. In fact, trade was always of minor importanceto the company, for it had been established to help the Tory governmentorganise the national debt and exploit public credit after nearly twentyyears of expensive warfare. Its political origins, as a counterweightto the Whiggish Bank of England and East India Company, werefundamental. As such it was a vital part of the ‘financial revolu-tion’ that took place in the generation after the Glorious Revolution of–. That revolution centred upon how the government establisheda permanent and funded national debt by employing parliamentarypromises of future tax revenues to repay what had been borrowed. Butinitially there was much about this that was uncertain and experimental.Some of those problems were mainly administrative and organisational,but some were political, not least because of the potential threat tocreditors of a Jacobite restoration. Consequently, very high interestrates often had to be offered in order to attract lenders. After thesuccessful peace of , which reconfirmed the Revolution settlement

P. G. M. Dickson, The Financial Revolution in England: A Study in the Development of PublicCredit, – () is the definitive account. I am very indebted to it.

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of and the Hanoverian succession, and when interest rates werenow much lower, governments naturally looked for ways to renegotiatethe debts of the s and s so as to lessen their burden.

In , mimicking events in Paris, the South Sea Company submitteda comprehensive scheme to do this, offering its own equity to thosepublic creditors who surrendered their original assets. This provoked acounter-proposal from the Bank of England, with the South SeaCompany winning the bidding war with the Treasury by offering£. million, though there was also considerable bribery and treating,both at court and in parliament, to obtain the necessary politicalbacking. Moreover, to get public creditors to exchange their assets forstock, the Company lured them less with the prospect of dividendincome, which would have required a profitable trade in goods, thanby a rising share price achieved by offering stock on extended terms,by hyperbole and, it is likely, by insider trading. In this it succeededhandsomely and soon its shares began to rise sharply in price. As Figure shows, about the start of the price stood at but rose tonearly , in June, a seven-fold rise. Given the modest tradingprospects of the Company such a rise was generated largely by the self-fulfilling expectation amongst investors and potential investors that theprice would rise, a state of mind that rested on a particular form ofconfidence or faith. But that confidence waned and slumped in Augustand September as more and more investors questioned theCompany’s medium- and long-term prospects. Quite suddenly it wasfound that ‘all is floating, all falling’. By October the share price wasaround , where it hovered until the full story began to emerge inthe spring of from an investigation by a House of Commons SecretCommittee.

At one level that was the South Sea Bubble; it was the spectacularrise and precipitous collapse of one company’s share price. But asFigure suggests, the stock market was more generally disordered in. The East India Company share price also surged by over percent and even that of the Bank rose by about per cent, both thenfalling back. In fact, speculation took place very widely. Though thedetails are very hazy, perhaps separate joint-stock projects werelaunched in and , with a collective nominal capital of £.million by one report, £ million by another, an unprecedented level

For detailed accounts of the scheme see Dickson, Financial Revolution, chapters –; J.Carswell, The South Sea Bubble (revised edn, Stroud, ). J. G. Sperling, The South SeaCompany: An Historical Essay and Bibliographical Finding List (Boston, MA, ) is aninvaluable guide to much of the available literature.

Historical Manuscripts Commission [hereafter HMC], Calendar of the Manuscripts of theMarquis of Bath, (), .

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Figure Three share prices, monthly, –Source: L. D. Neal, The Rise of Financial Capitalism: International Capital Markets in the Age of Reason (Cambridge, ),.

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of activity. Most were very fanciful, never raised much money andsunk quickly without trace, the passage of the so-called Bubble Act inJune and the issuing of writs against four of them in Augusteffectively putting an end to such a frenzy.

I turn now to consider three commonplace views which show thetypes of misunderstandings and myopia the Bubble has been prey to:first, that investors came from far and wide, but blindly left behind allreason and prudence, scepticism and caution; second, that it producedconsiderable social mobility by enriching many and impoverishing morestill; and, third, that its collapse led to widespread and profoundeconomic dislocation.

It is not hard to find contemporary expressions of each of theseviews, views that have proved highly resilient. In March , evenbefore the scheme had been approved, Robert Harley, the earl ofOxford, was told by his daughter that ‘The town is quite mad aboutthe South Sea, some losers, many great gainers, one can hear nothingelse talked of.’ By May his son reported that ‘The madness of stock-jobbing is inconceivable. This wildness was beyond my thought’ andin the following month that ‘The demon of stock-jobbing is the geniusof this place. This fills all hearts, tongues, and thoughts, and nothing isso like Bedlam as the present humour which has seized all parties,Whigs, Tories, Jacobites, Papists, and all sects.’ The social mobilitybemoaned was especially of the accumulation of fortunes by those oflowly and foreign birth and the loss of wealth and place by old families.The Worcester Post-Man newspaper, for example, reported that ‘a certainWharfinger . . . has gain’d , l. . . . by selling South-Sea’, that theCanton of Berne made £ million by trading in South Sea stock, andthat ‘Mrs Oldfield and Mrs Porter, the two celebrated Actresses, havequitted the Stage, having made their Fortunes by South-Sea-Stock’.

After the event, Sir Gilbert Heathcote, former lord mayor of Londonand a commercial and financial colossus, ‘was sorry to see great Estatesacquired by Miscreants, who, twelve Months ago, were not fit to be

A. Hammond, A Modest Apology, Occasion’d by the Late Unhappy Turn of Affairs, withRelation to Publick Credit (), ; Historical Register, (), –. Very little evidenceabout these companies survives. W. R. Scott provides information on the advertisedcapitalisation of of them, totalling £,,: The Constitution and Finance of English,Scottish and Irish Joint-Stock Companies to ( vols., Cambridge, –), , –.Actual amounts raised are unknown, but after most were suppressed by the Bubble Actit was claimed that ‘no less than a Million and a half . . . will be lost’: Northampton Mercury, June , .

The Bubble Act was, therefore, a cause of the financial crisis not, as is often thought,a consequence.

HMC, The Manuscripts of His Grace the Duke of Portland, (), . Ibid., . Mar.– Apr. , ; June– July , ; Sept.– Oct. , .

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Valets to the Gentlemen they have ruin’d’. That the pricking of theBubble was ruinous to the whole economy is similarly well attested.Contemporaries frequently remarked that the confusions of the cor-porate economy reverberated across the nation quickly and generally.By one report, for example,

What I reckon the Evil, which affects the Nation in general, is theDecay and Loss of private Credit; which is absolutely necessary tocarry on Commerce, to prevent the Nation’s losing Millions everyYear, to support the Government, to pay the Proprietor of the Fundshis Interest, the Landed-Man his Rent, to set the Manufacturer atwork, and clothe and feed the Poor.

If the effects of the stock market collapse crossed different sectors ofthe economy this was also held to have taken place quickly and to havecontinued for some months. So, for example, the government was toldin October that ‘the scarcity of money is a general complaint’ andthe earl of Oxford in February that ‘paper credit languishes . . .All credit in trade is stopped.’

These powerfully expressed views were, however, sometimes foundedon quicksand. The first point, which has often been forgotten, thoughDickson made it clear, is that the South Sea scheme was subjected toconsiderable debate from an early date. Most obviously the Bank ofEngland’s counter-proposals gained support in both the Commons andthe Lords, such that the South Sea scheme suffered from searchingcriticism both inside and outside of parliament well before it was givenstatutory form on April . In the Commons there were significantdivisions against the proposals, though we lack details of the debates toknow just what happened. In the Lords it was complained on Aprilthat the South Sea Company’s proposal ‘was unjust in its nature, andmight prove fatal in its consequences; since it seemed calculated forthe enriching of a few, and the impoverishing of a great many, andnot only made way for, but countenanced and authorised thefraudulent and pernicious practice of Stock-jobbing’. Here Lord Northand Grey was repeating a critique that had been well developed bytwo MPs outside the Commons. The best known of these was by SirRichard Steele, first in The Crisis of Property, then in A Nation a Familyand lastly in his periodical The Theatre, each produced early in . Inthe last he warned of the risks to public creditors of exchanging theirassets for South Sea stock. He doubted that the Company had good

Historical Register, (), . Considerations on the Present State of the Nation, as to Publick Credit, Stocks, the Landed and

Trading Interests (), –. Public Record Office, SP //; HMC, Portland, , . The Parliamentary History of England, ed. W. Cobbett (–), (), col. .

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trading prospects and, consequently, believed that ‘the Managers ofthis Stock will be . . . like the Bank at a Gaming-Table, who sit ingreater Security, and swallow by insensible degrees the Cash of theunfortunate Adventurers round the Board’. He was sure that thewhole scheme was nothing but ‘a bulky Phantom’. Steele’s pen wascharacteristically powerful, but like as not it rested upon the hardthinking and tireless arithmetic of Archibald Hutcheson, who had forseveral years made detailed enquiries into the national debt and becomea backbencher of considerable knowledge and weight on the subject.At the end of March , for example, he produced a pamphletattacking the South Sea scheme, concluding that ‘there is no realFoundation for the present, much less for the further expected, highPrice of South-Sea Stock’. Steele and Hutcheson were far from lonevoices, for a number of pamphlets complained that because theCompany’s trading prospects were poor, public creditors could betempted to surrender their original rights only by share prices beingmanipulated upwards, what contemporaries called stock-jobbing. Asone concluded on March , ‘it is pretty certain the Nation will bedeceived if they trust to the South-Sea Company’s Generosity to theAnnuitants’.

Clearly the weaknesses of the South Sea scheme were carefullydetailed in February and March , before it gained statutoryauthority. Those criticisms were powerfully and widely voiced, suchthat those who embraced the scheme would often have had to set asidesuch criticisms or been persuaded of the merits of the Company’sproposal. Doubtless avarice and dreams of luxury played their part inencouraging people to invest in the scheme, but other motives weresurely at work as well. One was that for a time the scheme looked likea legitimate and sensible investment. For several months the graduallyrising share price drew in investors, and that was fact not fiction. Justas important, the governor of the Company was the king, the schemehad been championed by the chancellor of the Exchequer and endorsedby parliament, and even some ‘professional’ investors invested in it,including the Bank of England, the East India Company and theMillion Bank. With such weighty supporters was it really so foolish ofthe wider public to embrace it given the information they had? Indeed,

The Theatre, ed. J. Loftis (Oxford, ), Mar. , . ‘Some Calculations Relating to the Proposals Made by the South-Sea Company,

and the Bank of England, to the House of Commons; Shewing, the Loss to the NewSubscribers, at the Several Rates in the Said Computations’, in A. Hutcheson, A Collectionof Treatises Relating to the National Debts & Funds . . . and also a Collection of Treatises Relating tothe South-Sea Stock and Scheme (), .

A Further Examination and Explanation of the South-Sea Company’s Scheme, nd edn (),.

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investing in it was partly a patriotic and a constitutional act – one forthe good of buoying a scheme to reduce national burdens. For sureother motives were also at work. Lady Pembroke, for example, com-plained that ‘nobody likes the thing yet . . . estates are got by it’ and sothe already financially strapped duke of Portland invested heavily,‘thinking to retrieve himself by the South Sea’ but only succeeded incompleting his ruin. Yet the perilous basis of the rising share pricewas appreciated early, with the mob insulting new coaches in the ringat Hyde Park in April with ‘the Cry of South-Sea-Stock, Stock-Jobbers, &c.’. Moreover, many investors were fully aware that the share pricehad to peak and, at least, stagnate at some point, so that what wascritical was selling at the right time or, more realistically, not selling atthe wrong time. As Alexander Pope noted in late September :‘Most people thought the time wou’d come, but no man prepar’d forit; no man consider’d it would come like a Thief in the night.’ Thiselement of gambling may not only have been widely appreciated buteven relished. Indeed, the distinction sometimes drawn between ‘ration-al’ investment and ‘irrational’ gambling is not very robust; buyingstock could be undertaken for reasons of consumption as well as ofinvestment. Certainly there is evidence of cautious investors selling upbefore the slide of share prices set in during August, most notably theduchess of Marlborough, Jacob Tonson the publisher and Thomas Guythe bookseller – though sadly those many public creditors who embracedthe scheme and surrendered their annuities were unable to do the samebecause the Company only issued their stock to trade on December. Investing, therefore, was undertaken for a range of reasons, someof which were credible. Other potential investors, perhaps persuadedby the likes of Steele and Hutcheson, gave the whole affair a wideberth, possibly in significant numbers. There were those who lacked‘Courage or Ability’ as one newspaper put it; and perhaps many werelike Harley’s daughter who was very clear that ‘It is being veryunfashionable not to be in the South Sea. I am sorry to say, I am outof fashion.’

Looking again at Figure , it is clear that if you had invested in theCompany in January and held fast through the Bubble to the endof December then your holdings would have risen in value by per

The Wentworth Papers –, Selected from the Private and Family Correspondence of ThomasWentworth, Lord Raby, ed. J. J. Cartwright (), .

F. Harris, A Passion for Government: The Life of Sarah Duchess of Marlborough (Oxford,), ; Worcester Post-Man, no. , – Apr. , .

The Correspondence of Alexander Pope, ed. G. Sherburn, : – (Oxford, ), . G. Clark, Betting on Lives: The Culture of Life Insurance in England, – (Manchester,

). Northampton Mercury, June , ; HMC, Portland, , .

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cent, an excellent rate of return. The effect of the Bubble on stock-holders, in other words, rested heavily upon the specific timing ofinvestment decisions. And here it is reasonable to suppose that fewinvested heavily after the peak in prices was clearly over, say from earlyAugust. Moreover, if the Bubble mainly entailed losses for those whobought or obtained shares in the rise of March to June they were notleft asset-less when the Company’s share price collapsed in the autumn.A further refinement to this point is that as the Company expandedthe number of its shares in the market through the four moneysubscriptions (or stock offers) so it asked for an initial payment followedby a number of subsequent payments spread over months and years.So, for example, John Gay the poet bought £, of stock in thethird subscription in June by making an immediate payment of£, which was to be followed by nine further payments of £,spread over nearly five years. With the collapse of the scheme in theautumn of such commitments were cancelled and share ownersissued with new stock at no cost. Gay therefore only ever paid for onetenth of his investment, of which he recovered £. This was a lossto be sure, and though in July his paper worth was said to have been£,, his real loss should properly be put at £. Quite whatfraction of his wealth this represented is unknown, but again manyinvestors would have committed only some of their funds to thescheme – much of their wealth was held in other forms. In terms ofproportions, though not of absolutes, this is probably the order ofmagnitude of losses of most investors in the scheme. Obviously suchlosses did not simply disappear into the ether, they filled the pockets ofthe well informed, the duplicitous and the lucky, perhaps to be hoarded,more likely to be spent and invested. Inevitably one person’s loss wasanother’s gain.

Cases such as Gay’s can be multiplied. So, for example, though it isoften said that Sir Isaac Newton lost £, in the Bubble the evidenceto support this is very inconclusive and certainly he was not immiseratedby it. Similarly the Canton of Berne did not make £ million out ofthe Bubble, but kept its holding, which dated back to a loan it hadmade in . Is it, however, possible to get beyond this case-by-caseapproach to uncover who bought into the company and how muchthey committed? It is not possible to answer that with any precision,for much evidence has not survived and that which has often looks

D. Noakes, John Gay: A Profession of Friendship (Oxford, ), –. For an example of the report see J. K. Galbraith, A Short History of Financial Euphoria

(Harmondsworth, ), . Its perilous basis is made clear in R. S. Westfall, Never atRest: A Biography of Isaac Newton (Cambridge, ), –, and The Correspondence of IsaacNewton, : –, ed. A. R. Hall and L. Tilling (Cambridge, ), –.

Dickson, Financial Revolution, .

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suspect, but early in the House of Lords received details of thefour money subscriptions. We can begin by looking at Table .

Table The South Sea Company’s four money subscriptions (stock issues),

Stock issued Total cost, £ Number of Average total Average firstsubscribers to pay £ payment, £

st, April ,, ,, , , nd, April ,, ,, , , rd, June ,, ,, , , th, August ,, ,, , ,

Sources: House of Lords RO, Parchment Collection, B–; P. G. M. Dickson, TheFinancial Revolution in England: A Study in the Development of Public Credit, – (), –.

A number of points arise from this. The first is that investors in theseissues were committing very substantial sums – the averages do nothide a long tail of small subscribers. Consequently, at a time when theannual income of prosperous merchants was reckoned in hundreds notthousands of pounds, when clergymen typically enjoyed incomes of£ and army and navy officers usually little more, it is clear thatinitial investors in the subscriptions were from the very wealthiestmembers of society, rarely from the middling sort and probably neverfrom the base of society. Second it is clear, as has long been recognised,that the scheme was underpinned by massive backing by the politicalelite – in the first subscription the royal family put down for ,shares, and Stanhope and Sunderland, the leading ministers in thegovernment, , each. As against that, only per cent of investorsin this first subscription were women, well short of the per centfigure for women’s holdings in loans of the Bank of England and EastIndia Companies at much the same time. The dominant impressiongained by looking at the first three subscriptions is of their politicalcomplexion, from the royal family, through the peerage, senior judiciaryand MPs to members of the urban and county elites, all translatingsome of their considerable wealth into South Sea stock. As Dickson hasshown, around three-quarters of members of the Commons and theLords were subscribers.

It is worth remembering that the first three subscriptions were directlycontrolled by lists kept by the Company’s twenty-nine directors, by itssub and deputy governor and through a handful of members of thegovernment – just thirty-five individuals for the third and largestsubscription. Each of these was given a finite amount of stock todistribute, such that to invest required not only substantial funds, but

Ibid., . Ibid., –.

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also connections and introductions, condemning even some high-statusindividuals to disappointment. Of course, a secondary market in thestock issued by the first three subscriptions developed, but only thefourth was placed on the open market, though even here investors werelikely to have been people of considerable substance. Where investorsmore generally were involved was with the exchange by public creditorsof their annuities for lower-bearing South Sea assets. Even so, the directevidence supports one contemporary view, voiced in October , that‘The loss would fall chiefly on the persons of quality.’ Put anotherway, contemporary reports of the hurly burly of Exchange Alley in need to be treated sceptically, indeed too many investors pursuingtoo few shares might cause such bustle. No hard evidence survives ofthe volume of shares being traded, only of their price.

From this pattern of investment activity there is good reason toquestion whether the Bubble produced considerable social mobility.Certainly cases of fortunes being made or lost can be found, but likeas not this tended to be within a fairly narrow section of society. Againfor want of evidence it is unclear how common gains and losses were,though given the close relationship between land and status someindications are provided by considering what was happening to theland market. Looking at land prices there initially seems to have beena significant effect. Clay has pieced together tidbits of information toconclude that in there was ‘an extraordinary explosion of prices’but that ‘These unprecedented prices lasted no longer than the specu-lative boom in South Sea securities’, a view confirmed by Habakkuk.

Such short-term price variations were caused by increasing demand forland from those who had seen their paper fortunes rise in London, notleast amongst directors of the South Sea Company itself, and anunwillingness amongst the landed to sell. That unwillingness was partlysocially driven, partly consequent upon the growth of the legal deviceof strict settlements since the Restoration. This can usefully be put inthe context of evidence of transactions implied by deed registrations inMiddlesex and the East and West Ridings of Yorkshire, though as thisis of numbers of deeds registered rather than the value or acreage ofland exchanged, it needs to be interpreted cautiously. In Middlesex,annual deed registrations rose continuously and by per cent between and . There was a decline of per cent in , but from the upward march of numbers was resumed. In the Yorkshire, bycontrast, a rise of per cent lasted from to , and was followed

HMC, The Manuscripts of the Earl of Dartmouth (), . C. Clay, ‘The Price of Freehold Land in the Later Seventeenth and Early Eighteenth

Centuries’, Economic History Review, (), ; J. Habakkuk, Marriage, Debt and the EstatesSystem: English Landownership, – (Oxford, ), –.

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by a fall of per cent in and two more years of stagnation. Inneither Middlesex nor the Yorkshire does the Bubble appear to haveled to a collapse of the land market and in the former, where theeffects were probably most direct, the consequences were distinctlyephemeral. Such evidence is, of course, quite general but it can becomplemented with much more specific evidence. French and Hoylehave recently concluded two detailed studies of all land transactionsthrough the period at Slaidburn in Lancashire and Earls Colne inEssex and in both places the years around were unremarkable;land transactions were no more and no less frequent than in the earlyeighteenth century as a whole. The suggestion from all of this is thatthose estates bought and sold because of the Bubble were few ratherthan many and, by extrapolation, that social mobility amongst thelanded was limited and specific.

I turn now to consider briefly how far the South Sea Bubble disruptedthe wider economy. To test this precisely ideally one would want tocall upon statistics of investment, output, employment and incomeeither side of . In practice the economic indicators to hand areoccasional and often imperfect, such that one is driven to use roughand ready proxies. For example, we have no year-by-year figures ofgross domestic product or output, and if historians have compiledyearly indices of industrial output they have clear limitations – thoughit is interesting to note that neither of the main indices show the Bubblehaving any impact whatsoever. So where can one turn? Overseastrade is one obvious resort, for the government had since collectedreasonably good data here. Again they show no marked effect in or , as imports and domestic exports fell by only and per centrespectively from to and re-exports grew by nearly percent. Excise data tell a similar tale of mixed fortunes amongst industries.For example, output of spirits and candles grew between and ,but fell for starch, soap and printed goods. So neither trade nor

F. Sheppard, V. Belcher and P. Cottrell, ‘The Middlesex and Yorkshire DeedsRegistries and the Study of Building Fluctuations’, London Journal, (), .

H. R. French and R. W. Hoyle, ‘The Land Market of a Pennine Manor: Slaidburn,–’, Continuity and Change, (), –. I am very grateful to Dr French formaking available to me as yet unpublished research on Earls Colne.

W. G. Hoffmann, British Industry, – (Oxford, ), Table (between –); N. F. R. Crafts, S. J. Leybourne and T. C. Mills, ‘Trends and Cycles in BritishIndustrial Production, –’, Journal of the Royal Statistical Society, (), . Onproblems of surviving evidence see J. Hoppit, ‘Counting the Industrial Revolution’,Economic History Review, (), –.

E. B. Schumpeter, English Overseas Trade Statistics – (Oxford, ), –, ;B. Mitchell, British Historical Statistics (Cambridge, ), , , –; T. S. Ashton,An Economic History of England: The Eighteenth Century (), .

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industry was universally or dramatically upset by the chaos of thesummer and autumn of .

For the largest sector of the economy, agriculture, statistical evidenceis especially creaky for any year-by-year analysis. That said, there isno reason to suppose that the Bubble would have directly or signifi-cantly affected the agricultural economy – the harvest of wassown prior to the crisis, that of largely after it and, as ever, theweather took its own course. Hoskins judged that for wheat thoseharvests were ‘average’ and ‘good’ respectively. Certainly prices foragricultural goods, generally low in this period, fell for many productsbetween and – by nearly per cent for wheat, per centfor cattle and per cent for hops for example – but whether thatwas caused by a slump in demand and/or a growth supply is impossibleto say. However, other things being equal, such falls would haveincreased expenditure on non-food items and lowered raw materialcosts for many industries, both effects helping to stimulate the widereconomy.

Some indicators of the effect upon the business and investment envir-onment are also available. For example, there was no overwhelming surgeof the number of bankrupts in the wake of the Bubble. Annual totals forthe three years , and were , and , a rise to besure, but hardly a meteoric one. Statistically speaking, for bankruptcythe long-forgotten crises of – and – were more significant.

Similarly, Muldrew’s important study of everyday credit and court actionover debt provides no evidence of the impact of the Bubble. That said,there is some statistical evidence that domestically liquidity was sought asthe Bubble burst, but it is not very compelling. This is most clearlysuggested by the rise in the price of gold, the once traditional bolt holefor the nervous investors. In the year prior to the summer of it wasvery steady at £. an ounce, but for the last four months of the yearwas generally per cent higher.

By available statistical data there is reason to doubt the depth andbreadth of the economic effect of the Bubble within Britain. Trade,industry and agriculture were their usual medley of success and failure.Some of the qualitative evidence suggests just the same. From complete

W. G. Hoskins, ‘Harvest Fluctuations and English Economic History, –’,Agricultural History Review, (), .

P. J. Bowden, ‘Statistics’, in Agrarian History of England and Wales, , part ii, –,Agrarian Change, ed. J. Thirsk (Cambridge, ), , .

J. Hoppit, ‘Financial Crises in Eighteenth-Century England’, Economic History Review, (), –.

C. Muldrew, The Economy of Obligation: The Culture of Credit and Social Relations in EarlyModern England (Basingstoke, ), , .

‘An Account of the Market Prices of Standard Gold in Bars’, Parliamentary Papers,–, , –.

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runs of the Northampton Mercury, Worcester Post-Man and Newcastle WeeklyCourant newspapers for the period, it is clear that though all carriednews drawn from the London papers of the crisis, none made note ofdecay or depression in local industries or trade brought on by thatcrisis. They reported the Bubble as very much a metropolitan phe-nomenon, albeit one with links to Paris and Amsterdam, and werepreoccupied after October with how the government and par-liament handled the catastrophe. Their silence on the local economy,though in keeping with their usual perspective, is as striking as theabsence of evidence ever can be. Elsewhere one occasionally comesacross positive evidence that the Bubble’s provincial impact was incon-siderable. William Stout, the Lancaster merchant, noted that ‘It didnot afect this country much, but the Lord Lonsdall lost most of hisestate.’ He was clear that local floods in October were muchmore destructive, though he did note monetary dislocation in thefollowing year.

Apparently powerful evidence of local disruption is provided byeighty-seven petitions, submitted to the House of Commons in theparliamentary session after the Bubble, complaining in some way aboutthe crisis. These came either from counties as a whole or from particularurban centres across Britain, from Caithness in the far north toSouthampton in the south, and from Pembrokeshire in the west toAldeburgh in the east. By the standards of the day this was a significantexpression of public opinion. Moreover, the petitioners sang from thesame hymn book. Birmingham, for example, complained that ‘Tradeamongst them is wonderfully decayed . . . they want Money to carry iton, and to pay the poor Workmen for their Labour . . . wholly owingto the Decay of publick Credit, occasioned by the Mismanagement,Avarice, and fatal Contrivances, of the late Directors of the SouthSea Company.’ Rochester in Kent lamented ‘the general Decay ofCommerce, Trade, Manufactures, and publick Credit, and from theMisery and Ruin which vast Numbers of his Majesty’s faithful andinnocent Subjects now labour under; occasioned chiefly by the wickedand detestable Contrivances, Artifices, and Mismanagement of the lateDirectors of the South Sea Company’.

There is no question that these petitions are powerful statements:their language is keen, their positions unequivocal. But they may notbe quite what they seem. First, the parliament they were submittedto opened in December (and closed in July ) but seventy-five

The Autobiography of William Stout of Lancaster, –, ed. J. D. Marshall (Manchester,), .

Journals of the House of Commons, (–), . Ibid., .

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of the eighty-seven petitions were submitted in just six weeks betweenmid-April and late May , fully nine months after the Bubbleburst. Most of them immediately followed the receipt by the Commonsof detailed inventories of the estates of the directors of the South SeaCompany and immediately preceded the decisions begun on Mayof how much of those estates were to be confiscated. Second, many ofthem employed strikingly similar language (hinting at an organisedcampaign) and particularly asked for the Company’s directors andtheir cronies to be punished fully. In only two is there meaningfuldetail about local circumstances. Third, the signatories of the petitionswere rarely groups of manufacturers or traders, much more frequentlygentlemen and leading citizens, often meeting at assizes, quarter sessionsor as corporations. Fourth, of the sixty-three sent by urban centresfifty-nine ( per cent) came from parliamentary boroughs. Finally, itis interesting to note that no petitions were submitted to the Houseof Lords or the Privy Council. These points suggest that the petitionswere reactions to the political rather than the economic aftermath ofthe Bubble, especially to the enquiry then underway in the Commons.They were less expressions of actual economic experience than exhort-ations to MPs to keep on the straight and narrow in their work ofretribution and repair. This particular context has often been lost sightof, with the petitions and similar evidence frequently being read simplyas statements of economic reality. But the politico-cultural consequencesof the Bubble were driven by their own imperatives that were attachedto the economy in a very confusing way.

There are good reasons to doubt that the Bubble generally disruptedthe British economy in the eighteen months after it burst in the latesummer of . Much data suggests that at that general level its effectswere relatively modest and that other apparently powerful evidence ofdisruption was often politically inspired. But undeniably there was aprofound crisis that turned some peoples’ lives upside down. Some ideaof the particular effects is provided by looking three exchange rates inthe period (see Figure ). From this it is clear that the London on Parisrate changed dramatically from late to mid-. Ashton long agopointed out that sharp shifts in exchange rates often indicated financialcrises – in his words ‘one of the earliest signs of impending crisis wasoften . . . an adverse movement of the foreign exchanges. Paradoxicalas it may appear . . . when crisis came there was usually a sudden . . .upward, or “favourable” movement’, which he explained in terms ofthe demand for holding sterling in cash. Certainly the graph ofexchange rates needs to be put in the context of reports from con-temporaries noting the flow of English funds into Paris and the

T. S. Ashton, Economic Fluctuations in England, – (Oxford, ), .

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Figure Three exchange rates, monthly, – (various denominations)Source: J. J. McCusker, Money and Exchange in Europe and America, – (), , , .

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Mississippi scheme in and the return of much of those funds andsome French capital besides into London and the South Sea schemein . In June , for example, it was reported that ‘Abundance ofMississippians and other Forreigners are come over to Negotiate inExchange-Alley.’ Though this graph apparently shows no particulareffects with regards to Amsterdam or Hamburg, with which Londonwas closely connected at the time, this is partly a question of thescale used, for both rates fell by about or per cent through muchof and rose about per cent from January to October .Again, this bears out contemporary comments about the internationalmovement of funds, of the flow of investments into Britain as theSouth Sea scheme unfolded and a flow out after the Bubble hadburst, though there were also reports of some English money beinginvested in Dutch schemes. Deposits at the Bank of Amsterdam, whichwe would expect to have been a bolthole for nervous investors seekingsolidity, rose from million guilders in to million in ,though of course much of this would have been from domestic Dutchinvestors. Such international flows would have influenced liquiditywithin overseas trade and it is interesting to note that within Englandnumbers of merchants going bankrupt did double between and. If the Bubble did not disrupt general trading patterns, theflow and ebb of funds across the Channel helps to demonstrate, asNeal has shown, one particular form of credit – international settlementsbetween major financial centres – that was deeply disordered in and . But, of course, such disorder was only partly provokedby events in London. The failure of the Mississippi scheme in Paris iswell known, but there was also a rash of speculative insuranceflotations in Amsterdam and northern Germany in that foundered.In part the South Sea Bubble was an international as much as anational phenomenon, to the extent that its label is rather misleading.

Problems within the sphere of international finance were linked tothose of domestic high finance. Well-grounded reports can be found ofruns on some banks and of others shutting shop, even going bankrupt.In September it was said that ‘four goldsmiths walked off’, theSouth Sea Company’s own bank, the Sword Blade Company, closedits doors, in October the bank of Midford and Martins in Cornhill

Worcester Post-Man, no. , – June , . J. G. van Dillen, ‘De Amsterdamasche Wisselbank, Mede Gedeele Door’, Economisch-

Historisch Jaarboek (), –. Public Record Office, B/. L. D. Neal, The Rise of Financial Capitalism: International Capital Markets in the Age of

Reason (Cambridge, ), chapter ; E. S. Schubert, ‘Innovation, Debts, and Bubbles:International Integration of Financial Markets in Western Europe, –’, Journal ofEconomic History, (), –.

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reportedly collapsed, perhaps owing £, to some creditors,and in December Wanley, a banker at Temple Bar, allegedly lost£, in the chaos. It is certainly notable that numbers of suicidesin London were per cent above trend levels in . Collapses ofgoldsmiths and bankers must have strained liquidity beyond London,but much depended upon the specific connections involved. So, BishopNicolson was told (probably wrongly) that Ulster ‘sensibly felt’ thedisruption and that by early December ‘Our Trade, of all kinds, is ata stand’, and if Cork was affected Dublin was not.

The Bubble’s effects were not generally felt across Britain and Irelandpartly because of the continued symbolic support for the Bank ofEngland from the king and prince of Wales (via Spencer Compton,speaker of the Commons), partly because in turn the Bank of Englandmade strenuous efforts to support credit and partly because the Treasuryraised the interest on Exchequer bills to build confidence in them asfinancial instruments. Similarly, in Scotland the Bank of Scotland actedearly to stop a drain of coin to London, such that the collapse of theBubble does not appear to have had much impact there.

The argument so far has been three-fold. First, that people investedin the Bubble for a variety of reasons, not mere acquisitiveness, andwere often more aware of the perils involved than is usually thought.Second, that probably most purchasers of new South Sea stock camefrom society’s patrician heights in both town and county, such that thesocial mobility between winners and losers involved a narrow band ofsociety. Finally, that the Bubble’s economic effects were more specificyet more international than is often allowed. Undeniably it was acatastrophe, but it was blown by particular people and its bursting hitparticular people. Fundamentally the Bubble was about high politics,high finance and high society.

These three points are not especially original, but they have oftenbeen lost sight of. They also pose something of a problem, for how isthe huge impact that the Bubble had at the time and in subsequentinterpretations to be explained? If, so to speak, some of the Bubble’s

HMC, Bath, , ; Northampton Mercury, Oct. , , Dec. , . London Bills of Mortality, counts of those said to have ‘made away themselves’, ‘self

murder’d’ or ‘kill’d themselves’. M. Macdonald and T. R. Murphy argue, in SleeplessSouls: Suicide in Early Modern England (Oxford, ), –, that this surge in numbers ofsuicides in the wake of the Bubble was a decisive final stage of a very gradual shift inattitudes away from viewing suicide only as self-murder.

F. G. James, ‘Derry in the Time of George : Selections from Bishop Nicolson’sLetters, –’, Ulster Journal of Archaeology, rd series, (), –; L. M. Cullen,‘Economic Development, –’, in A New History of Ireland, : Eighteenth Century,–, ed. T. W. Moody and W. E. Vaughan (Oxford, ), –. I am grateful toDavid Hayton for advice on this point.

R. Saville, Bank of Scotland: A History – (Edinburgh, ), .

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stature has been argued away, why did it make such an impact uponcontemporaries and why does it continue to be provide such an alluringreference point? I turn now to consider how this has taken place, todo which it is helpful (if necessarily artificial) to distinguish four phasesin the development of perceptions of the South Sea Bubble. Thesephases differed in scale and significance, but separating them allowsthe history of the myths of the South Sea Bubble to be sketched.

The first phase constituted the reactions of and , which, inturn, took two main forms. The first was concerned with the politicalcorruption and ill judgement that had allowed the South Sea Companyto win out over the Bank in early and then manipulate its shareprice in the spring and summer. The Bubble was in considerablemeasure caused by a dramatic failure of the political process to act forthe public good, thereby providing ammunition for opponents of theHanoverian succession and Whig one-party rule (the religious cre-dentials of which were already suspect to their opponents because ofthe recent repeal of the treasured Schism and Occasional Conformityacts, as well as Convocation’s suspension). Much of this reactionconcentrated upon those human frailties among particular individualsthat had allowed the innocent majority to be misled. Corruption andcronyism were blasted, its perpetrators hunted down in a passionatequest for punishment. But the political reaction also involved questionsof power and property, for at its heart the Company’s scheme aimedto undermine the value and integrity of earlier holdings of the nationaldebt. From one perspective ‘The owners . . . of this Property, who stepout of the Rank of common Subjects, with their Fortunes in theirHands, and gave them to the Faith of the Legislature, are exempt fromany Act of Legislature.’ But proponents of the scheme had to arguethat such property was not sacrosanct: ‘There are in England variousProperties equally secure with us; and yet we daily see the Legislaturebreaking in upon them, and giving the Possessors valuable Con-siderations; as in the Case of making Rivers Navigable, Publick Roads,Erecting of Forts, and other Publick Edifices.’ Put most simply, thiscentral part of the South Sea scheme was absolutely about liberty andproperty and consequently, given their totemic significance, could notbut cause a storm. But it also involved profound questions aboutdefinitions of ‘public’ and ‘private’ interest, about monopolies andindividual rights and queried the distinction hitherto all too happilyemployed between the landed and the monied interest. And if thecapacity for share prices to fluctuate markedly was confirmed by the

J. Hoppit, A Land of Liberty? England – (Oxford, ), . R. Steele, The Crisis of Property (), –. The Crisis of Honesty: Being an Answer to the Crisis of Property (), .

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Bubble, underlining its peculiarity as wealth, ideas that land had anintrinsic value were also shattered by the surge in its price in , ittoo ‘had taken its Frisk with the rest’. In short, the Bubble blurred manytraditional categories of political action and expectation, provokingconsiderable angst in the process.

Political reactions to the Bubble took place alongside what can bestbe called moral ones (there was no clear distinction between them). Agood deal of this was explicitly religious in language and sentiment,with many clergymen blasting the whole affair from the pulpit. Ofmore lasting significance has been the satiric reaction. It is a com-monplace that the period between the Restoration and the secondquarter of the eighteenth century was a golden age of satire and, giventhe commercial basis of publishing at the time, the Bubble provided itspractitioners with an irresistible target. Poems and ballads, plays andpamphlets, engravings and woodcuts were all employed. For manynothing better encapsulates the Bubble than Hogarth’s famous represen-tation, completed in . It is indeed a compelling, articulate and richwork that has powerfully influenced interpretations of the Bubble. AsPlates and show, other remarkable visual satires were also produced,though it is worth noting that domestic productions were numericallydwarfed by those from Holland and might, as in Plate , simplytranslate foreign engravings into an English setting. To literary satiriststhe Bubble was no less of a godsend, from Thomas d’Urfey’s ‘Hubblebubble’ ballad, to Jonathan Swift’s ‘The run upon the bankers’, JohnGay’s mock panegyric to the goldsmith Mr Thomas Snow and Alex-ander Pope’s later ‘Epistle to Lord Bathurst’.

Considerable ink has been spilt interpreting this outpouring, notmerely as art and literature but as windows into public opinion.

Undoubtedly this route has achieved much, but there are obviousdangers because satire is both polemic and caricature. It makes nopretence to factual objectivity or principled subjectivity, for it is anargument and a hope: as Defoe baldly put it ‘The end of Satyr isreformation.’ But what exactly needed reforming? Bishop Berkeleywas sure that ‘The South-Sea affair . . . is not the original evil, or the

A True State of the Contracts Relating to the Third Money-Subscription Taken by the South-SeaCompany (), –; J. G. A. Pocock, Virtue, Commerce and History: Essays on PoliticalThought and History, Chiefly in the Eighteenth Century (Cambridge, ), chapter .

For the Dutch prints see A. H. Cole, The Great Mirror of Folly (Het Groote Tafereel derDwaashed): An Economic-Bibliographic Study (Boston, MA, ). The English prints are dis-cussed in M. Hallett, The Spectacle of Difference: Graphic Satire in the Age of Hogarth (), –.

The best studies are S. Stratmann, ‘South Sea’s at Best a Mighty .’ The Literizationof a National Trauma (Trier, ), and T. Seymour, ‘Literature and the South SeaBubble’ (PhD thesis, University of North Carolina, ).

D. Defoe, The True-Born Englishman and Other Writings, ed. P. N. Furbank and W. R.Owens (), .

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Plate Anon., ‘The Bubblers Medley’, . Copyright Guildhall Library, Corporation ofLondon.

great source of our misfortunes; it is but the natural effect of thoseprinciples which for many years have been propagated with greatindustry.’ In this analysis, which was made by others, the South Sea

The Works of George Berkeley Bishop of Cloyne, ed. T. E. Jessop, (), .

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Plate B. Picart, ‘A Monument Dedicated to Posterity in Commemoration of Ye IncredibleFolly Transacted in the Year ’, . Copyright Guildhall Library, Corporation ofLondon.

Bubble could be viewed as a symptom of wider problems, where luxuryhad infected society and atheism was rampant. One sign of that wasthe alarming rise of highway robberies about London and of mas-querades and a debauched stage within – it is ironic that Steele’s attackson the South Sea scheme were in his periodical The Theatre thatdefended the stage from moralisers. It is worth recalling that in March there was a Privy Council proclamation against the so-called HellFire clubs, that in April a bill against blasphemy was introduced intothe Lords, though it was not enacted, and that at much the same timea campaign was underway by justices in Westminster to suppressgaming houses. Thus, it might appear providential that the plaguebroke out in southern France in the autumn of , promptingquarantine measures to keep it and God’s wrath at bay. There were,therefore, a range of issues of concern to the socially and religiouslynervous in and and the Bubble needs to be put in that widermoral-reform context. Contemporary reactions to the Bubble were

Hoppit, A Land of Liberty?, , . London Gazette, – Mar. ; Failed Legislation, –: Extracted from the Commons and

Lords Journals, ed. J. Hoppit (), (.); R. B. Shoemaker, Prosecution and Punishment:Petty Crime and the Law in London and Rural Middlesex, c. – (Cambridge, ), .

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often less about the Bubble itself than much wider perceived failings inthe politico-religious order. That is essential in understanding the forceof reactions to it.

The second phase of the development of myths of the Bubble tookplace in , when the term ‘South Sea Bubble’ was used for the firsttime in the original edition of the Encyclopaedia Britannica (volume , p.). Until then the main crisis of was invariably called the SouthSea ‘scheme’ or ‘affair’ – and through the whole eighteenth centurythe phrase ‘South Sea Bubble’ was never used in the title of anypublished work, including, it would seem, Hogarth’s engraving. Thebubbles of – lower case and plural – were those or so joint-stock ventures mentioned earlier. In and only very rarely wasthe South Sea scheme called a bubble at all, and in the many works Ihave consulted it was never called the South Sea Bubble. Consequently,the ‘South Sea Bubble’ is not in Johnson’s Dictionary, Smolett’s Historyor Postlethwayt’s Universal Dictionary of Trade and Commerce, all publishedin the s. What happened in was that a concept was inventedto make sense of the confused events of , but ever since this singlelabel has suggested a unity to what were three different if interrelatedevents: the South Sea scheme, the joint-stock bubbles and the crisisin international finance that began in Paris. Furthermore, words matterhere because of what they hint at. A bubble is all puff, waiting to bepricked whereas a scheme suggests more care, though perhaps no lessartifice. Contemporaries were clear that the bubbles were mereephemera, but that the South Sea scheme was much more substantialand serious. So to speak of the South Sea Bubble involves anachronismand elision, avoiding the care taken at the time to distinguish verydifferent things.

The third phase in the unfolding mythology of the South Sea Bubbletook place in the second quarter of the nineteenth century when theevents of became the subject of historical enquiry or reflection. Ifthis partly rested upon earlier work by the likes of Adam Anderson,who had been a clerk of the South Sea Company in , and byArchdeacon Coxe in his study of Walpole, there began in , thepowerful tradition of comparing financial crises of the day (– wasvery severe) to that of – a connection encouraged by the repealof the Bubble Act in that year. In this view there is a long history of

Given the Scottish origins of the Encyclopaedia it is interesting to note that the Scottisheconomy was showing distinct signs of over-heating in and suffered a major collapsein credit in the following year. See H. Hamilton, ‘The Failure of the Ayr Bank, ’,Economic History Review, (–), –. I am very grateful to Peter Marshall for thissuggestion.

A. Anderson, An Historical and Chronological Deduction of the Origin of Commerce ( vols.,); W. Coxe, Memoirs of the Life and Administration of Sir Robert Walpole, Earl of Orford (

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crises of which the Bubble was the first British instance (it is invariablylinked with the Dutch Tulip mania of and the French Mississippidebacle of -). This link between the past and the present wasexplicitly made in the title of an anonymous book of that year: TheSouth Sea Bubble, and the Numerous Fraudulent Projects to Which it Gave Risein , Historically Detailed as a Beacon to the Unwary against Modern Schemes. . . Equally Visionary and Nefarious. This approach reached a climax inCharles Mackay’s famous book of , Extraordinary Popular Delusionsand the Madness of Crowds, a work that has been in print for much of thepast years and which has inspired many successors, including J. K.Galbraith. Such an approach is prey to two objections: once againthe anachronism and the elision of identifying a single and unitaryBubble; and a certain teleology and de-contextualisation. In suchapproaches the peculiarities of the South Sea Bubble tend to be passedover, and its modernity and timelessness emphasised. It might almostbe said that the Bubble has been a victim of a type of Whig history.

Mackay and the railway mania of the s helped to embed theSouth Sea Bubble in both dictionaries and a wider literary con-sciousness. Indeed, it soon began to resonate more widely, and thisconstituted the final stage in the mythologising of the Bubble. As iswell known, concerns to avoid indebtedness and bankruptcy werecentral to so-called middle-class values in nineteenth-century Britain.

In such an environment the South Sea Bubble provided a particularpotent and apparently unambiguous negative exemplar in the culturalsphere. In , for example, Matthew Ward completed a major oilpainting called ‘The South Sea Bubble, a scene at Change Alley in’, now owned by the Tate. In the Bubble was the subject ofan historical novel and had become so commonplace that in thefanciful uses of the term began in earnest with a travel book calledSouth Sea Bubbles. The lure of the Pacific, which was in any case verystrong at this time, has often proved irresistible in this context, to theextent that the Latin American aspect of the South Sea Bubble is often

vols., ). For the crisis of – see A. D. Gayer, W. W. Rostow and A. Schwartz,The Growth and Fluctuation of the British Economy, – ( vols., Oxford, ), , –.The ‘Bubble Act’ was not the name given to the original statute of but, once again,a much later invention.

Most recently surveyed in Great Bubbles: Reactions to the South Sea Bubble, the MississippiScheme and the Tulip Mania Affair, ed. R. B. Emmett ( vols., ).

B. Weiss, The Hell of the English: Bankruptcy and the Victorian Novel (Cranbury, NJ, );G. R. Searle, Morality and the Market in Victorian Britain (Oxford, ).

And so was part of ‘the great age of history painting’: R. Strong, And When Did YouLast See Your Father? The Victorian Painter and British History (), .

W. H. Ainsworth, The South Sea Bubble (published in parts in and as a book in); Earl of Pembroke and G. H. Kingsley, South Sea Bubbles ().

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either overlooked or unknown. Either way, to use the South SeaBubble in such ways, as in Noel Coward’s play, is merely allusive,merely suggestive. That would not matter, but what is being alluded toand suggested melds, often unconsciously, fact and fiction indiscrim-inately.

Frivolous familiarity is unlikely to be the handmaiden of good historyand so it is unsurprising that for many years the South Sea Bubble hasbeen subjected to scholarly rigour. In that sense this paper contributesto a long line of studies, stretching back to W. R. Scott in -,through Carswell and Dickson and including, since , the highlyrationalist accounts of Neal, Garber and Harris. It has emphasisedthe need to approach the Bubble with an open mind: to use hindsightcautiously; to recognise the biases in contemporary evidence; to appre-ciate silences as well as noise; to employ appropriate concepts; to payclose attention to specific chronologies; and to place the Bubble in itsfull context. Too often contemporary lamentations of the Bubble havebeen taken at face value; too often second- or third-hand gossip hasbeen preferred to first-hand evidence; too often vibrant satires andcolourful jeremiads have been isolated from the discipline of counting;too often those aspects of the Bubble which were timeless have cast adark shadow over its peculiarities. In short, the South Sea Bubbleneeds to be rid of some of its myths. But such rationalism has its limits,for myths can be so powerful. As has been seen, the Bubble played amajor role in the early s in contemplating the consequences ofsubtle yet profound politico-religious changes; as a label it was inventedby ‘enlightened’ conceptualisation; then (and ever since) it became thebenchmark for moments of intense financial speculation, in the processbecoming so light and airy as an idea that writers could use it almostunthinkingly. The result is that the South Sea Bubble is a highly potentsymbol or mode of communication, too much part of everyday discoursefor its meaning to be easily changed by a mere muttering historian.

After all, if the myths of the South Sea Bubble were years in themaking, so perhaps putting good history back in will take just as long.

R. Edmond, Representing the South Pacific: Colonial Discourse from Cook to Gaugin(Cambridge, ).

Scott, Constitution and Finance; Carswell, The South Sea Bubble; Dickson, FinancialRevolution; Neal, Financial Capitalism; P. Garber, Famous First Bubbles (Cambridge, MA,); R. Harris, ‘The Bubble Act: Its Passage and its Effects on Business Organization’,Journal of Economic History, (), –.

My thinking on these issues has been greatly helped by P. U. Bonomi, The LordCornbury Scandal: The Politics of Reputation in British America (Chapel Hill, ).

On these issues see The Myths We Live By, ed. R. Samuel and P. Thompson ().

Documents

The myths of the South Sea Bubble - UCL Discoverydiscovery.ucl.ac.uk/12397/1/12397.pdf · THE MYTHS OF THE SOUTH SEA BUBBLE ... joint-stock South Sea Company which had been founded